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On Fairness: our estimates, ideals, and reality

Most Americans have little idea about the true inequality of our economy. They think it’s fairer than it is, they think it should be fairer than it is, but then aren’t yet ready to vote for fairness

That’s the news from a recent Slatearticle discussing studies in perception of economic inequality.

Here’s the part that I found truly illuminating. One study asked Americans two questions: what did they estimate was the percentage of overall wealth controlled by each quintile of the population, and what would be the ideal wealth distribution across the quintiles. Then, researchers compare the estimates and the ideal amounts with the actual amounts.

Respondents estimated that the top quintile, the top 20 percent, controlled about nearly 60 percent of the wealth, but ideally should control a little more than 30 percent. The top quintile actually controls more than 80 percent. That’s 50 percent more than their estimate and 260 percent more than their ideal.

Respondents estimated that the bottom quintile controlled about 4 percent of the wealth, but ideally should control about 11 percent. The bottom quintile actually controls nearly nothing. (In fact, the bottom two quintiles combined control nearly nothing.)

Respondents thought the poorest people had more than four times what they actually did, and should have 10 times more than they do.

I think this shows that we have a inherent bias towards fairness. It’s a basic assumption, one we hold without much questioning. This bias may be so strong that it blinds us to the actual level of unfairness in our current system.

Unfortunately, not enough people are compelled to put their ideals into practice. Even voting on policies to get reality closer to estimates, not their ideals, seems like a big stretch.